The Hidden Bottleneck in America’s Battery Race

The United States is spending billions to build a domestic battery supply chain, and most of the public conversation focuses on things that can be photographed: new plants in Nevada, lithium mines in the West, ribbon-cuttings for cell factories in the South.

But the harder problem, according to Lakshya Agrawal, sits upstream of any of that. It’s a finance problem, and the companies that figure it out will decide how the next decade of the industry plays out.

Agrawal has worked in fields like consulting, international public health strategy, and now advanced manufacturing. As a manager of finance and business operations at one of the world’s largest electric vehicle manufacturers, he believes the battery race will be won or lost on the quality of financial thinking companies put forward.

The ROI Playbook Was Built for a Different Product

The financial frameworks most companies use to justify manufacturing investment were designed for products that get sold directly, with returns that show up on a predictable schedule. A battery doesn’t quite fit that mold. In most applications, the company building the cell isn’t the one selling it to an end customer. It goes into a vehicle, an energy storage unit, or a grid installation, and the return on the cell investment is buried inside the economics of the finished product.

That mismatch, Agrawal argues, is where conventional ROI thinking quietly breaks down. A battery program is capital-intensive, geopolitically exposed, and tied to a technology curve that rewards incremental gains stacked over years rather than a single breakthrough.

He points to, for example, how the media and broader public often frame China’s position in the global battery supply chain as a technology story. Agrawal sees a financial infrastructure story running alongside it, decades of investment underwritten by institutions that focused on industrial position as much as quarterly returns. This strategy has been successful, as six Chinese battery manufacturers alone accounted for nearly 69% of all EV battery installations worldwide in the first ten months of 2025, according to data from SNE Research.

Closing that gap, in Agrawal’s view, requires American firms to develop financial frameworks as serious as the engineering problems they are trying to solve.

Modeling the Whole Stack, Not Pieces of It

Agrawal’s approach to vertical integration finance rests on a single discipline: model the entire cost stack end to end in one view. Anything less produces guidance that sounds rigorous but falls apart when dealing with extreme conditions.

Agrawal’s team builds financial models bearing the responsibility of accounting simultaneously for capital expenditure, operating expense, raw material costs, engineering timelines, manufacturing ramp assumptions, and geopolitical exposure.

The number that matters, he concludes, is total landed cost; in other words, what it takes to produce a battery, fully burdened, once every upstream investment is counted. A model that only holds up under ideal conditions is not a model worth pursuing, so programs are stress-tested against disrupted inputs, delayed industrialization, and new conditions in the market.

The modeling also has to account for incremental gains. Battery technology has advanced far enough that a single step-change innovation is increasingly unlikely. What moves the economics is a series of smaller process optimizations that grow as time goes by, and Agrawal’s team builds those into the cost thesis so new technology can be rolled out to customer-facing products.

That view translates directly into how investments are sized. “We might spend hundreds of millions to say we’re going to bring a new product to market,” Agrawal explains, describing how his team ties a capital commitment to a specific thesis on changing factors like production volume, factory ramp costs, global pricing, and target margins. Every major program is built around that kind of end-to-end financial model before the company commits to it.

To keep the analysis honest once a program is underway, Agrawal structures investment decisions around milestone-based gates. At each checkpoint, a program is measured against its overall cost and is compared how it’s performing versus how it’s expected to perform, at which point leadership makes a clear call on whether to continue or stop. Agrawal has applied this framework to multiple consequential vertical integration programs in battery production, advising executive leadership on capital allocation decisions that inform the company’s full product portfolio.

Applying Agrawal’s Framework In Real Programs

For nearly three years, Agrawal has applied this thinking to some of the most consequential vertical integration efforts in this sector, spanning lithium refining, active battery compound production, and in-house cell manufacturing.

His team built the financial case for a novel cell manufacturing process that had never been brought to commercial scale, which meant modeling scenarios under genuine technical uncertainty. He also supported the analysis for critical mineral refining and the associated compound production plants, an attempt to go further upstream than any EV company had previously tried.

In each case, the task was the same: justifying large, long-horizon capital commitments to an executive group that needed the realistic range of outcomes, never focusing on the most optimistic case. “Where I’ve added value is making sure that we understand what our actual landed-cost basis is for the continued investments we need to make to industrialize these,” he says.

Alongside the program work, his team manages the total bill-of-materials cost across every battery and powertrain product, which means actively tracking input costs in the attempts of reducing them, all across a globally distributed supply chain that directly shapes what the company can charge for its finished vehicles.

The through-line across all of it, in Agrawal’s telling, is that financial discipline and technical ambition shouldn’t have to be thought of as being in tension. The most ambitious programs tend to be the ones with the most rigorous financial infrastructure behind them.

What the Next Phase of the Industry Will Demand

Agrawal sees the battery and cell space moving into a phase of competition defined less by who invented a technology and more by who can industrialize it reliably and at defensible cost. New EV startups, legacy automakers progressively implementing this technology, and energy storage entrants will all run into the same financial modeling gaps that have slowed incumbents unless the industry raises its standards.

The defining advantage, in his view, will be the interface between financial and engineering teams. Companies that put real technical fluency into their finance teams, and real financial discipline into their engineering teams, will make decisions with a better criteria than those keeping the two disciplines separate.

He expects geopolitical pressure on supply chains to only grow, which means scenario planning will soon be a baseline requirement. And he expects sales and operations planning, in charge of deciding which cells go into which packs, into which vehicles, and in which geographies, to grow in strategic weight as product portfolios expand.

The people who will shape the industry’s next chapter, Lakshya Agrawal suggests, aren’t just the engineers in charge of building new methodologies. They’re the finance and operations leaders who can take those technical possibilities and apply them to a plan that’s financially executable. That capability is still scarce, still undervalued, and, on his reading, still decisive, and the companies and countries that build it first will set the terms for everyone else.